Onyx, JP Morgan’s blockchain business unit, and global fintech, Broadridge, are collaborating to offer JPM Coin as the settlement mechanism for Broadridge’s DLR (Distributed Ledger Repo) platform.
JPM Coin will complement DLR’s repo capabilities. These offer intra-day repo in addition to the current overnight and term repo capabilities prevalent in the market. The two firms have successfully tested use of JPM Coin with DLR. It is anticipated that JPM Coin will be available to Broadridge users as a settlement solution by June 2024.
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This would be the first instance of JPM Coin providing settlement capabilities to an external digital platform. Given the lack of “cash-on-chain” solutions in the industry today, this offering could act as a framework for other cash settlement solutions for other digital platforms going forward.
The solution involves synchronised settlement across the two blockchain networks achieving delivery vs. payment (DVP) cross-chain, on the basis of “locking” cash and releasing it synchronously with the asset transfers.
Nelli Zaltsman, Head of Platform Settlement Solutions, Onyx by J.P. Morgan, said: “We are delighted to launch our Synchronized Settlement solution using JPM Coin through our work with Broadridge. At Onyx, we look to be the foremost provider of Cash-on-Chain solutions to existing and steadily growing digital asset platforms globally. ”
Horacio Barakat, Head of Digital Innovation at Broadridge, added: “DLR continues to drive the transformation of global repo market infrastructure. This collaboration with JPM Coin represents another step in the digitisation of repo markets. This next innovation will power DLR as the ubiquitous intraday platform, leveraging existing market infrastructure in addition to new digital cash solutions.”
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By GlobalDataReaction from Broadridge and JP Morgan
Speaking exclusively to EPI, Barakat spoke on the timeline: “JPM Coin and DLR started working together late last year with the goal of solving interoperability between the two largest digital platforms in production today: JPM Coin being the largest digital global payment platform, and DLR the largest DLT repo platform processing over $1trn every month and transforming global repo market infrastructure.”
And what targets does JPM Coin have?
Zaltsman explained: “We launched JPM Coin in 2020 to provide better treasury solutions for corporate clients with complex global treasury needs. With the addition of Synchronized Settlement capabilities, we can now bring the efficiency of JPM Coin to the broader financial ecosystem for settlement of a wide range of transactions, particularly for users of transactional platforms benefiting from quick and efficient technology for one leg of a transaction, like an asset movement, that needs a payment solution to match in speed and timing.”
On future products and plans, Barakat concluded: “The first area of focus is the repo market, where we can jointly improve intraday liquidity management by DLR and JPM Coin providing the option for repo transactions in DLR to be settled utilising JPM Coin.”
